You can also go to Terminal's Preferences > Settings and choose the Shell tab, which gives you an option to run a command when the shell starts, and paste the line in that field. It won't affect anything other than Terminal, which could either be good or bad… I'm not sure, but I think adding it to your .bash_profile would change your directory even on remote login, which wouldn't make much sense, since you aren't using the Finder. (I'm probably going to use the command alias method, personally.)

I use the following when I don't want code to run if I'm logged in remotely (say, via ssh):

if [ "$TERM_PROGRAM" == "Apple_Terminal" ]; then
  ...
fi